Big Publishing

Why Do Authors Feel Hard Done By?

14 November 2018

From Publishing Perspectives:

I was struck by a comment on my last column about measuring commercial success in publishing. It came from Ryan Jones who is, I imagine, an author. He wrote: “Publishers pull in billions of dollars yearly and yet few writers can even make a living. What’s wrong with that picture?”

I thought it might be worth examining this widely held sentiment.

Of course he has a point, and I’m sure the various organizations supporting and representing authors would agree. There was a recent spat between the UK’s Society of Authors, the Authors Licensing & Collecting Society, and the Publishers Association, about this very subject.

. . . .

Per Saugman was a distinguished medical publisher, the force behind Blackwell Scientific Publications, the sale of which to Wiley is the reason that the UK still has a high-quality academic and trade bookselling chain, Blackwell Retail, in spite of the many challenges. Saugman explained to an author why he would not increase his royalty rate: “I’m not paying you the royalty, the purchasers of the book are. The higher the royalty rate, the more we shall have to charge and the less enthusiastic they will be to reward you.”

The royalty system is a fair one. It links an author’s income not to any abstract notion of worth but to how much the reading market will pay for the author’s efforts. Successful authors are hugely well rewarded and I’m sure would prefer the current system to any other. JK Rowling, Danielle Steele, Stephen King, and many others have built fortunes from their books and frequently are able to deploy those fortunes generously and properly.

And then one should consider why writers write. It’s not always (or even usually) for money. There are many motivations.

For instance, a lawyer might want to write the ultimate book on her subject of expertise. It’s a way of establishing her credibility and hence the value of her professional practice. A few hundred or thousand dollars either way will be of little consequence but what she wants is a publisher whose brand carries weight, whose editorial support systems and marketing reach are first rate.

. . . .

The main complaints seem to come usually from so-called midlist authors whose income is almost certainly in decline. But that’s not from publishers taking more. It’s simply the case that general fiction (the bulk of this sector) is more widely split than ever between the bestsellers and the not-so-good sellers. Public library sales, which were the bedrock of midlist hardback sustainability, are in decline. Paperback sales have been eroded by lower-price ebooks. Fewer retailers are willing to dedicate space to any but the top 100 or so novelists. Self-publishing has created a tsunami of digital fiction, thus deflecting sales from the traditional market.

None of that is of any comfort to the professional writer seeing his or her income decline. Nor does it help that publishers seem willing to pay large advances to unknown new authors in the hope of finding the next big thing after a massive twelve-way auction. The trouble is that every now again the next big thing is the next big thing and it is the big things that keep general publishers in business.

. . . .

Yes, the publishing industry is big. A survey conducted by the World Intellectual Property Organization and the International Publishers Association estimated total global sales of US$41.9 billion in 2016.

. . . .

The industry also employs many millions of people worldwide. And pays taxes. And creates markets.

But as I said in my previous column, sales don’t represent profits.

Publishing is highly competitive. Margins in certain sectors at certain times can be high. An unexpected bestseller can transform a business. Finding a new niche or a new market can generate profit and cash, but in the normal course of events, a publisher is happy to make a 10-percent return on sales (trade authors typically receive 10 to 20 percent of the publisher’s sales) and to generate enough cash to stay in business.

Publishing is a good business and an important one for all sorts of reasons, but publishers are not the greedy sharks they’re sometimes portrayed to be, nor are their companies out to prosper at the expense of authors. If authors’ incomes are in decline, the solution is to find a larger cake, not to argue about the size of the slices.

And Stanley Unwin’s famous quotation still holds true: “The first duty of any publisher to their authors is to remain solvent.”

Link to the rest at Publishing Perspectives

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Lighter release schedule hampers Hachette UK in third quarter

8 November 2018

From The Bookseller:

Hachette UK’s revenues were down 6.7% in the third quarter of 2018, due to a lighter release schedule and decline in sales in its education segment, its parent company Lagardere has reported. The fall in sales in the UK has been attributed “mainly” to an absence of curriculum reform, which also affected France and Spain’s performance.

David Shelley, Hachette UK’s c.e.o., conceded overall the third quarter had “fewer major releases for HUK”, but pointed to “some unexpected bestsellers and strong backlist and e-book sales”. He also said Hodder Education’s results “tracked the market, which was muted in September due to distance from the last curriculum change”.

The dip is comparably better than it was in the third quarter of 2017, when sales dropped 13.5% following the success of Harry Potter and the Cursed Child (Little, Brown) the previous year.

. . . .

Of the publisher’s performance in third quarter 2018, Shelley commented that digital publisher Bookouture had enjoyed “a very good summer with sales in the UK up year on year and significant growth coming from the UK and Australia” while John Murray Press enjoyed its second best ever month in August.

Link to the rest at The Bookseller

Bowker’s ISBN SIte Has Been Hacked, and Credit Card Numbers Have Been Stolen

4 November 2018

From The Digital Reader:

When I reported 3 days ago about MyIdentifiers.com’s extended downtime, I made an offhand reference to a report about credit cards being stolen on the site. I didn’t really trust that unconfirmed story, but it was later confirmed by another author, and now Bowker admitted that due to their sloppy website security, they were indeed hacked.

From Bowker:

Bowker was recently made aware by the payment card networks of patterns of unauthorized charges occurring on cards after they were legitimately used on Bowker’s website, www.myidentifiers.com. We immediately launched an investigation and engaged a leading forensic firm to assist. Our investigation has identified unauthorized code that was added to the checkout page on our website. Based on currently available evidence, our investigation is focused on determining if the code was active from May 1, 2018 through October 23, 2018. However, because our investigation is continuing, complete findings are not available and it is too early to provide further details on the investigation. We anticipate providing notification to any affected customers as we get further clarity about the specific timeframes and orders that may have been affected.

Bowker has not said when their site will be online again, but they did say that you can still buy a single ISBN through a different site. You can also buy a block of ISBNs by downloading an order form and faxing it in.

Link to the rest at The Digital Reader

PG suggests that a one-time credit card number may be prudent for dealing with Bowker in the future (if you feel an irresistable craving for an ISBN number).

From MarketWatch:

Capital One last month announced a new feature for its credit cards called “virtual numbers.” They are one-time numbers consumers can use while shopping online so they don’t have to give their actual Capital One credit-card number to an online retailer.

To get the virtual number, card holders must visit their Capital One online profile, through the Capital One website. There, they can find a tool called “Virtual Numbers from Eno,” named after Capital One’s virtual assistant Eno. The tool creates unique, virtual numbers for each merchant, linked to their Capital One credit card account. But the online retailers don’t receive the actual number printed on consumer’s physical credit card.

. . . .

It’s Capital One’s latest answer to combatting online credit card fraud. Several banks, including Bank of America and Citi have started similar systems.

When fraud is detected on credit cards, “I have to go through and update my card everywhere I’ve ever put it,” said Tom Poole, the senior vice president of digital payments and identity at Capital One. “But if you’re like me, you don’t know where you put your card.”

Link to the rest at MarketWatch

What’s the Matter with Fiction Sales?

4 November 2018

From Publishers Weekly:

According to 2017 estimates released this summer by the Association of American Publishers, sales of adult fiction fell 16% between 2013 and 2017, from $5.21 billion to $4.38 billion. The numbers, though not a major worry, raise questions about the books the industry is publishing and what consumers want to read.

Since 2013, fiction sales fell every year with the exception of 2015. That year they rose 1%, helped by Harper Lee’s Go Set a Watchman and three other novels that topped one million print copies sold. (The AAP tracks all major formats—print, digital, and audio—in its sales estimates.) Interviews and discussions with various industry members uncovered different theories about why there’s been a downturn in fiction.

The most commonly shared view is that it has become extremely difficult to generate exposure for novels. Fiction, more than nonfiction, depends on readers discovering new books by browsing. Now, with the number of physical stores down from five years ago (despite a rise in ABA membership), publishers cannot rely on bricks-and-mortar stores providing customers with access to new books.

Nor can publishers depend on media outlets to make up for the gap left by the shrinking footprint of physical bookstores. Review space in mainstream media has been slashed, cutting off another possibility for readers to learn about new fiction.

The upshot of those developments is that publishers have found breaking out new writers—never mind developing new franchise authors—increasingly difficult.

Creating authors who can draw readers via name recognition alone is crucial to selling novels. Research done by the Codex Group shows that the author is the most important factor in a person’s decision to buy a novel. Codex founder Peter Hildick-Smith says that with so much inexpensive genre fiction now available at “subprime price points under $5” (from such channels as Kindle Unlimited), publishers must invest to develop brand name authors who can command premium-price loyalty.

That process can require a multiple-book commitment. It can also require a type of commitment that’s difficult for publishers: sticking with authors who don’t produce instant bestsellers.

Based on Codex research, a person typically reads an average of three books by an author before becoming hooked on his or her books. Publishers, however, as Hildick-Smith and others interviewed noted, seem increasingly reluctant to support authors whose books don’t immediately sell. “Creating a dependable, bestselling author is a multibook investment that requires different strategies and great persistence,” Hildick-Smith said. “It’s not a one-and-done launch.”

The difficulty publishers have recently had in creating brand name authors can be seen in BookScan numbers. The service, which tracks only print sales, shows that fiction sales continue to be soft. Moreover, the BookScan figures show that no fiction title topped one million copies sold in 2016 or 2017 at outlets that report to the service. In 2015, the only year in the past five when fiction sales rose over the previous year, four novels sold more than one million print copies each, according to BookScan: Watchman (1.6 million), Grey by E.L. James (1.4 million), The Girl on the Train by Paula Hawkins (1.3 million), and Anthony Doer’s All The Light We Cannot See (one million).

Link to the rest at Publishers Weekly

Attentive readers will note the single mention of Amazon – Kindle Unlimited, associated with “subprime price points under $5”. Traditional publishers can’t and won’t compete in that market, preferring authors and books with “premium-price loyalty”.

PG suggests that category title is not properly worded. Instead, he believes that traditional publishers are trying to promote authors and books that attempt to command “over-priced loyalty” from readers.

As readers come to understand that most of the money they pay for traditionally-published books goes to middle-folk like bookstores and publishers with very little trickling down to authors, their loyalty to premium pricing may erode.

Imprint consolidation at big houses is a sign of changed times

26 October 2018

From veteran publishing consultant, Mike Shatzkin:

I had reason to learn recently that Ingram has 16 million individual titles loaded in their Lightning Source database ready to be delivered as a bound book to you within 24 hours, if not sooner. So every book coming into the world today is competing against 16 million other books that you might buy.

That number — the number of individual book titles available to any consumer, bookstore, or library — has exploded in my working lifetime. As recently as 25 years ago, the potential titles  available — in print and on a warehouse shelf ready to be ordered, or even to be backordered until a next printing — was numbered in the hundreds of thousands. So it has grown by 20 or 30 or 40 times. That’s between 2000 percent and 4000 percent in the last quarter century.

This has, like the Internet or CO2 in the atmosphere, changed everything. And it seems like the organizing structure of the major publishers is also changing in response.

On Monday morning, Simon & Schuster became the second major house in a week to announce that it was consolidating two imprints, effectively reducing by one the number of discrete publishing units within the conglomerate empowered to decide what to publish and how to promote it. They folded the Touchstone imprint into Atria and Gallery; last week Penguin Random House collapsed their Crown imprint into Random House (sometimes referred to as “Little Random”.)

The title explosion is part of a sea change in the world of book publishing that has taken place over the past quarter century. At the same time, sales have shifted in two dimensions: a big chunk of the books now bought and consumed are digital, not printed, and more than half the books consumers buy are not bought in brick-and-mortar stores. And the share for physical stores continues to shrink. Indeed, these trends are linked. The fact that books can now be delivered without inventory, without a sales force, and without a warehouse has made it possible for just about anybody to publish a book.

. . . .

Commercial publishers bring books to market to make money for themselves and their authors. But today, book publishing is a idea-dissemination or brand-extension tool for many originators, and making money on the publication is a secondary consideration.

That means that commercial viability is no longer an effective check on the number of titles. One wealthy and digitally-smart author we know is reluctant to engage with a publisher because he wants to be free to give away his content. And in another case we found and discussed in a recent post, because the originator was so enamored of the idea of giving it away through web streaming, they ignored the opportunities through commercial ebooks that would have required setting some price a bit higher than zero to work in that channel. Anybody doing this more than once will figure out ways to increase their distribution.

It wasn’t very long ago that nobody would think seriously about publishing a book unless they had the infrastructure — a sales force, a warehouse, a way to process shipments and returns — to put books on many bookstore shelves. Now those services are ubiquitously available for variable, not fixed, costs (you can reach the whole world through Ingram Spark or a big chunk of the world through Amazon Kindle and CreateSpace).

. . . .

In the new marketplace, where most of the sales don’t require the expensive-to-engage distributed bookstore infrastructure, established publishers no longer automatically dominate. So we’ve gone from a marketplace where only truly professional publishers could effectively get books to customers to one where their size, their lists, their sales forces, and their operational efficiencies give them much less competitive advantage. That new marketplace and the competitive set means that publishers can no longer count on a reasonably substantial minimum sale for every title they publish.

. . . .

For as long as I’ve been in the industry, I have heard publishers complain “there are too many titles” while the smartest ones also saw that their own profitability was improved by increasing their own company’s title output. But over the past two decades, the title glut has hit home and even the biggest and most powerful publishers need to exercise restraint about what they try to publish profitably. Because they really can lose money publishing a book, which two decades ago was actually a rare occurrence in a major house unless they had wildly overpaid for the rights.

Publishers have also found it sensible to redeploy resources from “sales” — working with intermediaries to reach a book’s customers — to “digital marketing”, which often leads to a direct sales appeal from the publisher to the consumer. (Although the sales themselves might be executed through Amazon or another retailer, the publisher’s effort is driving the specific sale to the specific customer.)

This has, inevitably, made publishers more “audience centric”. They build topic- or genre-specific websites, apps, and — critically — email lists. The email lists of book purchasers are of increasing value, if the publisher can continue to feed it choices from which it will find things to buy.

Link to the rest at The Shatzkin Files and thanks to Nate at The Digital Reader for the tip.

PG suggests that, not long ago, publishers would not have considered direct sales efforts to readers via mailing lists, etc., because bookstore owners would have objected. The OP suggests to PG that publishers have mentally written off Leonard Riggio/Barnes & Noble and no other bookstore chain is big enough to intimidate them.

At a time when real digital marketing talent is widely recognized as a valuable skill, PG also wonders what sorts of digital marketers are willing to go to work for a publisher instead of a tech startup or digital marketing agency with potential for some real upside.

For authors, signing a standard contract with a traditional publisher looks like something akin to an extraordinarily expensive exclusive contract with a digital marketing agency which you can’t fire for incompetence or failure to respond to your emails.

And where’s the nurturing in that sort of relationship?

Publisher Revenue for Trade Books Increases in August 2018 and Year-to-Date

18 October 2018

From The Association of American Publishers:

Publishers’ revenue for trade (consumer) books and PreK-12 Instructional Materials increased in August 2018 compared to August 2017, continuing the trends from the July data which also saw growth in these categories. The increases added $26 million in revenue (+1.2%) for publishers in August 2018, offsetting slight declines in other categories.

For the first eight months of 2018 (Jan. – Aug.) trade publishers saw growth in all tracked categories – Adult Books, Children’s/YA and Religious Presses – compared to the same timeframe in 2017. Adult Books added $153 million (+5.2%) for the year-to-date compared to 2017. Overall book publisher revenues were down slightly (-0.6%) through August 2018.

. . . .

Print books generally saw revenue growth, with strong gains in both hardback and paperback books in August 2018 vs. August 2017. Publisher revenue also increased +45.2% for downloaded audio compared to August 2017. Revenues for eBooks and board books were flat at +0.2% and -0.2% respectively.

Link to the rest at The Association of American Publishers

‘Up-lit’ gives hope to publishers at Frankfurt book fair

13 October 2018

From The Guardian:

A debut novel about a lonely old woman who has fallen through the cracks of society has wowed publishers at this week’s Frankfurt book fair, with 10 presses fighting to win a book that is being compared to the smash hit Eleanor Oliphant Is Completely Fine.

The television producer Beth Morrey’s first novel, The Love Story of Missy Carmichael, has emerged as one of the biggest titles among a deluge of fiction following the trend for uplifting literature, or “up-lit”. Selling to HarperCollins for a six-figure sum after a 10-way auction, the novel finds elderly Missy Carmichael living alone with her husband gone, her daughter not speaking to her and her son in Australia – until she adopts a dog.

Morrey, who works three days a week for RDF, wrote the novel while on maternity leave with her son at the end of 2016. “My husband suggested we put him in nursery two days a week so I could write a book,” she said. “It took me three months. I basically emptied it out, and enjoyed it more than anything I’ve ever done.”

After a terrible year “with all those celebrities dying, Brexit and Trump,” she continued, “I wanted to write a book that could make people cry, but with happiness, not sadness. I felt like we needed a bit of catharsis. It’s what I wanted for myself – that washed-out crying feeling. Everyone wants to know things will be OK on a micro level. Obviously on a macro level we’re all doomed but if you can read a book and feel a bit happier then that’s no bad thing.”

Link to the rest at The Guardian

Pieter Swinkels of Rakuten Kobo

8 October 2018

Pieter Swinkels is executive vice president for publisher relations and content with Rakuten Kobo.

From Publishing Perspectives:

Pieter Swinkels: In Kobo Writing Life, our self- and micro-publishing platform, we’ve seen an enormous growth in serialization and shorter episodes.

Not so much the short-form you’re probably referring too, though—the short-form initiatives we’ve seen from more traditional publishers have had uneven results across different markets.

In our ebook subscription services in the Netherlands, we’ve been very successful in creating series with shorter-than-usual books as episodes-in-a-series that we produced ourselves in our Originals program or in collaboration with publishers or producers.

Publishing Perspectives: Do you also see efforts by some publishing interests to cater particularly to consumers who may actively like long-form reading?

PS: Yes, we see experimentation from both independent and traditional publishers to create value bundles through bundling.

These are mostly promotional campaigns, and less so initiatives to create long-form reading experiences.

There’s a drive on, according to some observers, to find ways to make reading—which many say is on the decline in our contemporary cultures—more palatable by appealing to people who want to read short segments of things during their commutes, and so on.

PP: Have you seen examples of real success in this direction?

PS: First of all, people have never been reading as much as they are nowadays. It’s just that they’re not reading what the book industry creates for them. That’s a problem, but only to those working in that industry.

We fail as an industry to create readers for our content. That should be much more top-of-mind than it currently is. We allow other industries to cannibalize what used to be time devoted to books.

Clearly, the audiobook experience seems to compel readers back to “books.” That’s encouraging.

We’re also seeing fantastic engagement inside Kobo Plus, our ebook subscription service.

Series, in particular, replicate a binge-consumption behavior we know from other entertainment industries.

In my view, it points to the importance of lowering thresholds to enter reading and spending money on reading.

. . . .

PS: As a reading industry, we’ve only just begun to untie the knot that authors, agents, publishers, and retailers have pulled very tight for a long time. It all begins with creating a new dialogue of how we work together, and that must begin with trust.

Depending what market you look at, there very encouraging, early signs of a genuine willingness to approach the challenges in the reading business.

Having worked as a publisher before becoming responsible for the Kobo catalogue, I believe we need to start with the author and work our way back to all other parties involved to make the business models fit.

Link to the rest at Publishing Perspectives

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